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The energy revolution is unfolding in slow motion

Twenty years ago during my brief stint as a nuclear trashman I used to joke that the National Environmental Policy Act of 1969 (better known today as NEPA) was actually a disguised employment program for the superfluous college graduates parented by America’s middle class. Perhaps Richard Nixon actually signed this legislation in a surreptitious effort to create paying jobs for all those anthropologists, field biologists, sociologists, statisticians, hydrologists, ecologists and other assorted Liberal Arts & Sciences students who would have wound up flipping burgers without it. The legislation’s public hearing requirements also generate profitable employment for public relations specialists, behavioral psychologists, historians, cultural experts, social workers and self-described “facilitators” (someone who courteously explains to you what you really meant to say — but didn’t). A vast sub-culture of boutique firms ready to accurately count and track desert tortoises or screen for sage grouse, butterflies and minnows reside comfortably in the furrows of the NEPA process.

For NEPA’s first 30 years, the act served primarily to delay public projects that might create adverse environmental impacts (in other words, pretty much everything). It was Skip Spensley, the environmental attorney responsible for shepherding Denver’s application to construct a new International Airport, who first explained to me that NEPA is not a permitting scheme so much as it is a meticulous review process. If applicants can demonstrate that their decision-making analysis included a thorough consideration of every conceivable eventuality, involved the requisite number of stakeholder hearings, solicited and evaluated public comments and generated an appropriately hefty draft report, then they are free to justify whatever recommendation they preferred all along. Fail to jump precisely over each hoop and project opponents and, more to the point, their attorneys can pounce, challenging the adequacy of the NEPA review. This provides a rich ecosystem for the consulting firms that generate the supporting data that informs Environmental Impact Statements. Spot a beetle, catch sight of migratory fowl, turn up a pottery shard or, calamitously, a splinter of human bone and you’ll swiftly find yourself adding another sub-contractor.

For decades this process has worked swimmingly for environmentalists, as well as local governments. They’ve been empowered to pull project proponents through the painful grommets built into the EIS process. In response to noisy demands for “Context Sensitive Solutions” (don’t ask — use your imagination) concessions are extracted that include items like “off-site mitigation.” As you may suspect, this is something like the Congressional employment of a federal shutdown as a bargaining chip intended to force the President to defund Obamacare, only without providing pay for your time off the job. Extortion costumed as compromise captures the underlying operating principal. Need a new library or a state-of-the-art firehouse? This is the time to ask. But what happens when a project comes along that supports environmental sustainability?

Wind and solar projects

When I noted that the University of Denver’s Sturm College of Law had scheduled a Renewable Energy Law and Policy Summit offering Continuing Legal Education credit to participants, I couldn’t pass it up. There have to be big bucks generated in environmental law practice or it wouldn’t be receiving this kind of attention. While perhaps half the attendees were either attorneys or law students, there was a liberal sprinkling of speakers and participants from a veritable alphabet soup of renewable and sustainable energy organizations with acronyms to match. Holland & Hart together with Welborn Sullivan Mack & Tooley were corporate sponsors with extensive environmental law practices. Holland and Hart provided a handout bragging about its work on behalf of Duke Energy to conclude a 400MW wind turbine purchase from Vestas of Colorado. This was the third annual such summit held at DU, which offers degree programs that specialize in renewable and natural resource law.

Mark Manly, executive vice president of Duke Energy’s Commercial Business division, including its renewable energy projects, was introduced as both an economist and a lawyer. He took the opportunity to tell the mandatory lawyer joke. “Do you know why medical researchers are starting to use lawyers rather than white mice? They’re cheaper and you don’t get emotionally attached to them.” He made it clear Duke is in the renewable energy business because it is proving profitable. Half the added generation capacity built nationwide in 2012 was renewable. By 2025, another $225 billion will be invested in wind farms and nearly $200 billion in solar installations. Manly disappointed one questioner when he made it clear that Duke has no philosophical commitment to sustainability or the mitigation of global warming unless the investment produces returns for his shareholders. He also grumbled about the allocation of costs in the “net metering” of rooftop solar systems.

Renewable energy advocates believe that rooftop installations should be paid full retail rates for their excess power production, while utilities insist that it should be discounted both for the cost of access to the transmission network and the investment required to maintain back-up power when the sun isn’t shining. The Colorado PUC will soon wrestle with these fairness questions in a net metering docket. That should produce plenty of work for lawyers — as will the acceptable rate of avian mortality from wind turbine blades. Apparently there is a further problem created by the Migratory Bird Treaty Act, although what that problem is was never adequately explored. Presumably, wind turbines are also whacking them. There is an additional threat at solar farms that boil water or liquid salt in a central tower with reflections from a large mirror field. Fly too close to the boiler and birdies are instantly roasted.

Jennifer Gardner with the Western Interstate Energy Board and Linda Davis with the Western Governor’s Association both acknowledged that Western states have a huge business opportunity if we can lick the licensing problem (remember NEPA?). Half of American coal-fired electric generation plants will need to be replaced during the next 20 years, 75 percent in 30. Most of them fail to meet even Nixon era emissions standards. Currently it takes seven to 10 years to permit a new transmission line. The Western Governors would like to reduce that to three to four years. Needless to say, it won’t be easy. Phil Anschutz’s Transwest Express transmission line, linking Wyoming wind to Las Vegas and the California grid, is on an accelerated permitting path, but is now closing in on year four. Another 400 renewable generation applications are pending in a system that only appears capable of processing 10 or 15 each year. A Wind Zone Development plan is being written as well as a Western Solar Plan.

We may be in the middle of an energy revolution as Steve Black, the former renewable energy Counselor to Secretary of the Interior Ken Salazar claims, but it is a revolution unfolding in slow motion. A carbon tax would accelerate our conversion to renewable energy sources and might even be agreeable to many in the utility industry, but the chance of adopting such a disruptive measure appears vanishingly small. It’s interesting to learn that fuel (oil and gas) consumption in the U.S. peaked in 2007. We may also soon become the second largest petroleum products producer in the world. Sounds like time for a revised national energy policy, although that appears unlikely before 2016, if then. China is now burning half the world’s coal and importing more oil than we are, which leaves them ever more vulnerable to oil pricing from ourselves, the Russians and other exporters. Adam Reed with the Renewable and Sustainable Energy Institute observed that fracking has converted what we think of as oil exploration into a farming technology — locate the shale, drill it, fracture it and harvest the petrochemicals. Where’s the risk in that?

It’s probably a good thing the attorneys at DU are encouraging a conversation regarding clean energy policy. Someone needs to be ready — especially in Colorado.